Valmet, Zilkha Biomass Energy announce agreement

February 19, 2014, Houston, Texas – Zilkha Biomass Energy
LLC and Valmet have signed a five-year collaboration agreement in the field of
steam exploded black pellets. The purpose of the agreement is to bring steam
exploded black pellets to the market. These pellets are principally used for
replacing fossil coal as the energy source in heat and power generation. The
parties will work together to develop a joint global offering.

"Valmet is a highly regarded technology provider in the
pulp, paper and energy industry. Their network will provide a great channel for
introducing manufacturers to the advantages of the Zilkha Black(R)
Pellet," says Jack Holmes, CEO of Zilkha Biomass Energy.

"Through this five-year collaboration, we are
partnering with a well-established technology and equipment supplier to offer
advanced solutions for the growing biomass market. We are very excited about
this arrangement," Holmes continues.

"The market for steam exploded black pellets is
expected to grow rapidly in coming years as the pressure to replace fossil
fuels with sustainable environmentally friendly alternatives is getting
stronger. Combining Zilkha's deep know-how in pellet production and
distribution with Valmet's project capabilities brings great opportunities to
develop and exploit a new emerging technology," says Rickard Andersson,
Vice President, Bio Technology and Environmental Systems, Pulp and Energy Business
Line, Valmet.

Steam exploded black pellets provide a number of benefits
compared to traditional wood pellets. These include improved durability,
water-resistance, higher energy content, lower shipping costs, and reduced dust
problems compared to other types of bio-based pellets. Due to their properties,
these black pellets can be handled in similar manner to fossil coal. This
significantly reduces, or even removes, the need for expensive investments in
logistics and plant rebuilds.